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12.05.2023, 01:21

US Treasury yields to rise amid debt ceiling standoff – Reuters poll

US Treasury yields will rise significantly over the coming month, per a survey of nearly 28 analysts by Reuters conducted during May 05 to 11. The poll also states that the respondents were split over whether the risk of a US default was higher or the same as prior stand-offs over the debt ceiling.

Key findings

Half of the respondents said the risk of a default was higher this time compared to prior episodes of debt ceiling brinkmanship.

Analysts, however, warned that the current situation may be riskier owing to widening political divides.

U.S. 2-year and 10-year yields are forecast to rise over the coming month by around 20 and 10 basis points, respectively.

Asked in what range the 10-year yield, currently at 3.38%, would trade over the coming month, the median response from strategists who were polled was 3.30%-3.60%.

Individual responses ranged from as low as 3.0% to as high as 4.0%.

Also read: USD/JPY fades bounce off weekly low around mid-134.00s amid downbeat yields, mixed mood

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